There is a common rally cry right now amongst local businesses to convince customers to spend their money locally, rather than spending in a national chain store, or online. Movements such as the 3/50 project and “Think. Shop. Buy. Local” all point out that spending money in local businesses will improve your local economy. As a business owner that has both a local bricks and mortar retail hobby shop, and a large online retail hobby shop, I know what it takes to run both a local business and an online business.
The problem I see with the ‘Buy Local’ campaigns is that they generally leave out some important issues. Simply spending your money on a local business JUST because they are local, does not make any sense. Not EVERY business deserves your dollars, especially when those local businesses don’t provide good customer service or after sales support. One of the common misconceptions out there amongst small bricks and mortar shops is that buying online is an impersonal experience, and online stores can never provide the same level of customer service as a local small business. Nothing can be further from the truth! Modern online businesses have highly trained customer service representatives to take care of their customers via phone, email or live chat. More importantly, online businesses know that after sales service and customer support are critical to remain competitive, because customers simply won’t come back and shop with you again if you don’t treat them right. There are plenty of other businesses out there for them to spend their money with.
So the core point I want to make is that if a local business wants customers to spend their money with them, they need to understand that they HAVE to start providing a high level of customer service and after sales support. This should not be something new, as local businesses have always had to do this, but before the internet the local businesses had a more captive market as customers did not have much else in the way of options, especially in smaller towns such as Chico where I currently live. With the advent of the internet, the local business now has to contend with a whole new range of online businesses that are competing in their own back yard. This is similar to small businesses lining the streets in a highly competitive shopping district (such as down Bridge Road in Melbourne, Australia). With so many businesses all selling the same products in close proximity, if they DON’T learn how to treat their customers right the store next door is going to steal their sales, and they will go out of business. This is effectively what is happening now with local businesses as the online business is the new business that just moved in next door.
There is a good article from Carol Tice on Entrepreneur.com discussing what makes shoppers buy local. In this article she says:
Personal service. I have yet to talk to a small business owner who thinks they don’t have great customer service. But customers tell another story. On review sites and local forums, the fangs come out about rudeness, sloppy follow-up, or a just-don’t-care attitude.
Personal service, or just plain good customer service is critical for a business to retain customers whether they are local or online. But my experience with many local businesses in recent years (and alas some online ones), is that sometimes customer service seems to be an afterthought and something the business owner would prefer not to do. Once the sale is done, it is done. If the customer has an issue, they explain why they cannot help you and send you on your way. The end result is that single sale was saved, but the business just lost that customer and they likely won’t ever come back. Worse, if they are really upset they may tell all their friends via Facebook or Twitter about their experience, and THEY then won’t spend their money with that business.
So it is pretty clear that if any local business wants customers to spend their money with their business, they need to EARN that business. They should not ever simply EXPECT that business because they happen to be local.